Here’s a piece of surprising news from Vietnam. The South-East Asian nation is coming up with its own car, and plans for the “national car” is already underway.

According to Reuters, Vingroup, the country’s leading property developer, has kickstarted the construction of the car factory in a project worth US$1-1.5 billion in the first phase. Vingroup’s construction brand Vinfast has signed an MoU with Credit Suisse for the bank extend $800 million in financing. The 335-hectare factory is located in Haiphong, a northern city.

The car project is part of the group’s expansion plan into the heavy industry of Vietnam, its vice chairman said in a statement. Of late, Vingroup has ventured into the retail and health care sectors.

Vingroup said it hopes to be a top car manufacturer in ASEAN, making 500,000 cars per annum by year 2025. It expects to produce 100,000 to 200,000 vehicles per year in the first phase, with a range that will include a sedan, seven-seater SUV and electric-powered motorcycles.

A company spokeswoman told Reuters that the factory would roll out the first electric motorcycle in 12 months and first car in 24 months. Vinfast plans to purchase blueprints of car engines and main mechanical systems from top European and American designers, it is reported.

The “national car” dream is nothing new to Malaysians. A brainchild of former prime minister Tun Dr Mahathir Mohamad, Proton was founded in the 1980s and enjoyed a lion’s share of the Malaysian car market before market liberalisation levelled the main advantage the local brand had against foreign makes – price. In June, DRB-Hicom sold a 49.9% stake in the loss-making company to China’s Geely.

Mahathir, now the opposition leader, has stated his desire to start another automotive company if his Pakatan Harapan coalition wins in Malaysia’s upcoming general elections.

Danny Tan loves driving as much as he loves a certain herbal meat soup, and sweet engine music as much as drum beats. He has been in the auto industry since 2006, previously filling the pages of two motoring magazines before joining this website. Enjoys detailing the experience more than the technical details.

Volvo, a sound company with good track record of safety and engineering. The only thing that did badly was their design language at that time and consumers acceptance of their vehicle. They needed money to progress and they did. Proton are way way behind. They needed money to feed the directors. Very weird design language and tidak apa attitude. Fail tak apa. Ask 10 Malaysians and 9 will tell you they don’t care anymore. Simple question. If they lower the price of accordana to $100k, will there be takers? Proton will always be a budget vehicle with dreams of being a European competitor. I’ve owned 4 protons before and I’ve seen enough to decide so.

Malaysia used to be an agricultural country..according to a former Proton executive of whom was interviewed by Richard Hammond in 2001…so I figure this is the best way Vietnam is going to transform itself from a very agricultural country to an industrial nation like Malaysia

Proton could have approached Vingroup, and offered to use the many platforms it has under license. They can totally create a new body above it. This way, proton can have the economic of scale while Vingroup can enjoy a huge reduction in terms of cost and time factor.

Vietnam should not make the same mistake as Malaysia. To reach economy of scale it has to become a global brand. As a latecomer it is very unlikely to be able to compete with the established makes.

What will happen is predictable:
1. Protectionism will jack up the price of imported makes.
2. Vietnamese will be forced to buy low tech locally made cars.
3. The Vietnamese auto manufacturer will never be able to compete globally so it has to depend on the captive domestic market.
4. Eventually the market will liberalize but there will be a lost generation of Vietnamese who will are unable to enjoy foreign cars.

Non relevant to compare with Malaysia, Vietnam does not even has discrimination policies since unification and emphasis nation of Vietnamization every citizen is Vietnamese no matter which ethnic group belongs to. Furthermore Vietnam has the large population for achieving the economic scale…

Matimatisyen Universitas on Sep 05, 2017 at 11:23 am
Non relevant to compare with Malaysia, Vietnam does not even has discrimination policies since unification and emphasis nation of Vietnamization every citizen is Vietnamese no matter which ethnic group belongs to. Furthermore Vietnam has the large population for achieving the economic scale…

The problem with automotive companies here in Asia is that they only want to sell premium high-class cars. What Vietnam, Cambodia and Thailand needs is a great QUALITY car for the masses. If Vietnam can make a quality car that most all people could afford, they will succeed when so many have failed. Volkswagen from Germany was just that kind of company in the beginning. Today, they are the 2nd largest automotive company in the world…

rebadge is way to go. like what perodua and naza are doing right now. even japanese and european car makers have done it for decades. look at collaboration between ford, mazda, suzuki, nissan, renault, citroen and peugeot.

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